Friday, July 24, 2009

Your tax dollars at work

Joshua Gans on Twitter linked to this rather cool (in a nerdy, economics kind of way) tool, that shows where your tax dollars go. It's called taxcheck; and all you need to do is punch in how much you earn, and it works out how much income tax you'll pay, and then divides it up. For example if you earn $70,000 a year, you'll be happy to know that you'll pay about $14,850 in tax, of which $64 goes towards paying the Baby Bonus; $1.89 towards early childhood education, and $377 will go towards Government schools.

What is interesting is if you punch in what you expect to pay $100 in tax, you can find out the percentage make up of the tax pie.

So, for example, out of every $100 of income tax, 1 cent goes towards assistance for caring for dementia patients, 1 cent as well goes towards the National Gallery of Australia, $1.50 goes towards fuel tax credits for commercial users of heavy diesel vehicles, and 1 cent towards the cleaner fuels scheme.

It's an interesting way to see how the budget pie is divided, in effect, to see the priorities of the Government.